Science and technology

Dropbox

A nebulous future

BEFORE Apple launched iCloud in 2011, Steve Jobs allegedly offered to buy Dropbox, a file-sharing service founded in 2007, for $800m. When Dropbox declined, Apple's late boss disparaged it as a feature, not a company. Soon after, Dropbox raised $250m, putting its value at over $4 billion. Earlier in December Dropbox concluded a promotional campaign that, in just a few weeks, added 2m new users, bringing the total to over 100m, roughly double the number when Jobs made his comment. Consumers, it seems, can't get enough of the feature.

Dropbox dominates online file-sharing. It boast three times as many users as its closest direct rival, YouSendIt. (Its dominance is even more pronounced when it comes to the volume of data stored.) It eats up 20% of all bandwidth consumed globally by browser-based file-sharing services, against 1% for YouSendIt. Dropbox users save more than 1 billion files every day.

Most of them use the free version of the service. The company makes money by charging for extra storage. Around 4% of users plump for the premium version, though the proportion is growing, according to Arash Ferdowsi, one of the Dropbox's co-founders. The recent campaign, called Space Race, gave away free space to university students in return for getting their peers to sign up to the service. The hope is that when access to this extra storage runs out after two years, the students, by then freshly-minted professionals, will pay to keep using it.

Dropbox relies on individuals and small firms, for whom its rudimentary security features are good enough; bigger businesses with sensitive information prefer more secure services like Box.net. The advent of competitors in the nebulous form of iCloud, Google’s Drive and Microsoft’s Skydrive, which come pre-installed on their respective makers' gadgets, does not seem to have dampened enthusiasm for Dropbox. Unlike iCloud, which boasted 190m users by October thanks to its deep integration with Apple's mobile devices, the service is "platform neutral"—ie, works across different devices and operating systems—and allows easy file-sharing, both useful traits in an increasingly connected world where few people hew devoutly to a single device-maker.

Google and Microsoft clouds emulate Dropbox in these respects. But at a little over 10m users each, they do not yet benefit from from the incumbent's powerful network effect. If you are sharing files with a dozen other people on Dropbox, a move to Google or Microsoft would require all 12 to move with you.

Dropbox is also striving to make itself the default choice for smartphone users. In 2011 it struck a deal with HTC, a Taiwanese phonemaker, to preinstall Dropbox on its Android devices. In return it gives HTC users 5GB of space for free. HTC has been struggling of late, but Mr Ferdowsi says that his company is in talks with other manufacturers, hoping for similar arrangements.

A bigger long-term worry is the plummeting price of digital storage. With its vast scale, Amazon has driven down costs substantially for the likes of Dropbox, which leases server space from the e-commerce giant. But Google Drive already offers 100GB for $5 a month, half what Dropbox charges for the same amount of storage. And Google can advertise its cloud across its myriad online offerings. Dropbox's margins are only likely to get wispier in the future.

Earlier this year, we unplugged our network server and went to Dropbox for Teams. It's terrific, not least because any file is now accessible from anywhere on any device. We do pay for the service, but at only 25% of our previous IT costs.

icloud as an IT technician is very hard to work with, consider an application which constantly expects itself to be online when someone hands you their PC to be fixed, endless message boxes interfereing with normal operations. The user HAS to log out to stop it, there is no other option to stop the behaviour. Programs that potentially are a problem are windows live which gives an option to have manual starts (Start/computer/manage/services) (), game clients(Steam, Orgin) and most Anti Virus Software. Very bad practice, bad for the user unless its the Anti Virus Software because the users interest is coming last - after all its the users bandwidth, data cap, memory and processing time.

The problem with dropbox is that it is easy to use, share data across platforms and it is based in the US; it does not encrypt data and markets itself towards professionals in Europe who should know better than to use a FREE service hosted outside the EU with confidential data in violation of EU data protection rules - and does not warn the user of this in any way that a non technical person would understand. Cloud services should be served with a privacy health warning. My main example would be a Headmaster storing pupil data from sims pages in Excel documents in Dropbox, to those who know this is an export from SQL database which would have all the pupils home and contact data stored in the document. Because users never encrypt the pages we are relying on chance and goodwill in what has become a major hacking target for the data harvester. But they still do it.

" If you are sharing files with a dozen other people on Dropbox, a move to Google or Microsoft would require all 12 to move with you."

This sentence is factually wrong.
You can share files or folders with anyone even if they are not subscribed.
The truth of the matter is that there isnt any real difference in the functionality of any of them. The winner/s will be the ones with the most reliable cloud.

It's factually wrong if you shared the files, they downloaded them, and that's the end of the story. It's not wrong if all 13 people are actively using Dropbox to collaborate on the file, i.e. a 13-way auto-sync.

It is interesting you don't mention Google Drive until the very end. I'd consider that to be a closer competitor to Dropbox than Microsoft/Apple cloud systems for the proprietary factors you suggest, whereas Google Drive can be installed as an app on an Android device as well as an Apple device.

I'm a little hesitant to entrust my data to a content provider, such as Apple. Terms of service usually allow them to disable an account at their sole discretion, with or without cause, as Amazon has done to Kindle users without explanation.

Content companies seem likely to have a broader set of automatic flags for shutting down accounts than storage-only firms, and at least some of those flags are apparently not obvious to users. I think I'll stick to firms like Dropbox, and remain a little obsessive about backups.

None of the competitors are usable in an enterprise context. The reason is one that the Economist omits, because the Economist is written by/for MBAs who think it's all a marketing difference.

The actual difference is that Dropbox has a technological advantage; it uses a significantly better underlying sync algorithm. For corporate teams sharing or modifying large files, or updating encrypted volumes, the competitors use so much bandwidth as to be unusable.

Dropbox is the only viable enterprise option. The rest are consumer toys.

All three services (Dropbox, MS SkyDrive, Google Drive) can be used on Apple, Android and Windows Phone devices as apps. Moreover, all 4 of them (above 3 + iCloud) can be used on Mac OS and Windows personal computers.

The neat thing about Dropbox is they've made it very easy to share files across platforms. You can be given access to a dropbox very easily. It actually reminds me of the old "public folder" idea only done better.

A number of my programs and apps - if those are really different things - use Dropbox for synching. For documents of my own, I use iCloud because it translates those into iOS format so I can work on my iPad. The messy bit is I have to download from iCloud to my Mac because the file formats aren't the same. That means I get a version in iCloud and some older version on my Mac and have to worry about confusion there.

I agree with Steve Jobs. Cloud-based file sharing is going to become a standard OS feature. I don't really see how DropBox and the rest of its independent competitors are going to last. As we saw in the '90s on desktop OSs, any feature useful to most of a devices users will sooner or later get incorporated into the OS. On top of that, these services are more-or-less interchangeable with their only difference being price and capacity. Both of these can be changed easily and, therefore, do not represent unique features with which to lock-in customers.

Storage is very much like a commodity, and it is only good to give business to the likes of Dropbox and Box.net, otherwise the big boys would never lower their prices.

Having used both, plus the traditional "private" storage, I would point at even newer solutions like the Manugistics presented at VMWorld CA recently as a neat means to make yourself a semi-private storage on cloud and include collaboration. Collaboration is way more relevant than just storage.

Dropbox is the de facto King of data storage & sync for consumers, hands down, no doubt about this.

The problem is that the business/enterprise user needs more than just sync. The business user needs security assurance and the ability to put his/her documents to work. She/he needs piece of mind when employees carry corporate files on their mobile devices outside the office. This is not possible with Dropbox and Box.

http://www.springcm.com, designed from the ground up as a cloud content services company for business that closes exactly this gap. Your files are synced, your content is safe and private, your process is fully automated.